Banque de Commerce et de Placements SA, DIFC Branch and Another v China Aviation Oil (Singapore) Corporation Ltd and Others [2024] SGHC 145

Sham transactions and letters of credit in commodity sales

This is the most recent decision in a series of cases that have reached the Singapore courts involving banks seeking recovery of payments made under letter of credit transactions in commodity sales. This judgment - as in the string of judgments that preceded it - narrates the complex interplay between the carriage, sale and financing. It also elaborates on the additional risks that arise when string trades are executed on a back-to-back basis, and one party to the trade becomes insolvent.